UNIVERSITY OF FLORIDA
3 1262 08483 0198
Register No. 273-02
NATIONAL RECOVERY ADMINISTRATION
PROPOSED CODE OF FAIR COMPETITION
AS SUBMITTED ON AUGUST 25, 1933
The Code for the Thread Industry
in its present form merely reflects the proposal of the above-mentioned
industry, and none of the provisions contained therein are
to be regarded as having received the approval of
the National Recovery Administration
as applying to this industry
GOVERNMENT PRINTING OFFICE
For oale b the Superintendent of Documents. Washinalon. D.C. .- -. Price 5 cents
THE THREAD INSTITUTE
THE THREAD INDUSTRY-CODE OF FAIR COMPETITION
For the purpose of effectuating the policy of the United States
Government as declared in Title I, Section 1, of the National Indus-
trial Recovery Act, the members of the Sewing, Crochet, Embroidery,
and Darning Thread Industry whose signatures are appended here-
to, hereby apply to the President as provided in Section 3 of the said
Act to approve the following Code of Fair Competition for the
Sewing, Crochet, Embroidery, and Darning Thread Industry, and,
subject to such approval, and for the period designated in Section 2
(c) of Title I of the National Industrial Recovery Act, they hereby
agree to all the terms of this Code.
TITLE 1-APPLICATION OF THE CODE
1. (a) This Code of Fair Competition, hereinafter referred to as
the Code, shall apply to all manufacturers of sewing, crochet, em-
broidery, and darning thread who are doing business in the United
For the purposes of this Code, manufacturers of sewing, crochet,
embroidery, and darning thread, shall be defined to be all producers
of such thread, and the producers of such thread shall be defined to
be all persons, firms, and corporations who operate machinery in the
production of the said threads or of any of them and all persons,
firms, and corporations who purchase yarn or unfinished thread and
cause the further processing of such yarn or thread for the purpose
of selling the same as a finished article.
(b) In construing the application of this Code of Fair Competi-
tion nothing herein contained shall be deemed to prohibit any mem-
ber of the industry from exercising all its and/or their lawful patent
rights or as requiring any member of the industry to do any act in
conflict with the terms of a patent licensing agreement legally bind-
ing upon such member.
(c) For the purposes of this Code the term "productive machin-
ery shall be taken to mean all machinery used for spooling, wind-
ing, reeling, or skeining as a final process to produce thread ready
for sale as a finished article.
(d) The effective date of this Code shall be the second Monday
after the approval of the Code by the President.
TITLE 2-SPECIFIC AGREEMENTS WITH THE GOVERNMENT'
2. Members of the industry who have signed this Code are here-
after referred to as the parties hereto ", and they agree that the
provisions of this Code shall be the standards of fair competition
for the Sewing, Crochet, Embroidery, and Darning Thread Industry
in the United States, and that every violation of the standards estab-
lished in the Code shall be deemed an unfair method of competition
in commerce within the meaning of the Federal Trade Commission
Act, as amended. The Sewing, Crochet, Embroidery, and Darning
Thread Industry will hereinafter be referred to as the Thread
3. The parties hereto agree:
(1) That the parties hereto shall not impose any inequitable
restriction upon admission to membership in the association or group
of which they are a part, and that the parties hereto are truly
representative of the Thread Industry.
(2) That this Code is not designed to promote monopolies or to
eliminate or oppress small enterprises and will not operate to dis-
criminate against them, and will tend to effectuate the policy of
Title I of the National Industrial Recovery Act.
(3) That the parties hereto will abide by such conditions (in-
cluding requirements for the making of reports and the keeping
of accounts) for the protection of consumers, competitors, employees,
and others, and in the furtherance of the public interest as the
President in his discretion deems necessary to effectuate the policy
declared in said Act.
(4) That the parties hereto will abide by all Federal, State, and
Municipal laws and ordinances affecting the health and safety of
workers in the locality where they are employed.
(5) On and after the effective date employers in the cotton textile
inulustrv shall not employ any minor under the age of 16 years.
(6) Employers in the Cotton Textile Industry shall comply with
the requirements of the National Industrial Recovery Act as fol-
lows: "b(1) That employees shall have the right to organize and
bargain collectively through representatives of their own choosing,
and shall be free from the interference, restraint, or coercion of em-
ployers of labor, or their agents, in the designation of such repre-
sentatives or in self-organization or in other concerted activities for
the purpose of collective bargaining or other mutual aid or pro-
tection; (2) that no employee and no one seeking employment shall
be required as a condition of employment to join any company union
or to refrain from joining, organizing, or assisting a labor organiza-
tion of his own choosing; and (3) that employers shall comply with
the maximum hours of labor, minimum rates of pay, and other con-
ditions of employment, approved or prescribed by the President."
(7) That the President may from time to time cancel or modify
any order, approval, license, rule, or regulation issued under Title
I of the National Industrial Recovery Act.
TITLE 3-WAGES AND HOURS OF LABOR
4. On and after the effective date of this Code the minimum
wage that shall be paid by employers in the Thread Industry to
any of their employees-except learners during a six weeks' ap-
prenticeship, cleaners, and outside employees-shall be at the rate
of $12 per week, when employed in the Southern Section of the
industry, and at the rate of $13 per week when employed in the
Northern Section, for forty hours of labor.
5. On and after the effective date employers in the cotton textile
industry shall not operate on a schedule of hours of labor for their
employees-except repair-shop crews, engineers, electricians, fire-
men, office, and supervisory staff, shipping, watching and outside
crews, and cleaners-in excess of 40 hours per week and they shall
not operate productive machinery in the cotton textile industry for
more than 2 shifts of 40 hours each per week.
TITLE 4-THE THREAD INSTITUTE
6. The parties hereto have adopted a Constitution and Bylaws
for The Thread Institute, an unincorporated association having an
office at 11 West 42nd Street, New York City. Subject to the con-
trol and direction of the President, The Thread Institute will act
as an agency to aid the Thread Industry to operate under the terms
of the National Industrial Recovery Act, and with respect to said
industry, to effectuate the policy of the Government as declared
in Title I of said Act.
7. The Institute, acting through its agents duly appointed, shall
gather from members of the industry information as to cost of pro-
duction, accounting systems, wages, working hours, and other
relevant data for the purpose of preparing and submitting to the
President for approval such further agreement or agreements relat-
ing to the Thread Industry as will adequately protect employees,
employers, consumers, competitors, members of the trade, and others
in furtherance of the public interest as contemplated by Title I,
Sections 3 and 4 of the National Industrial Recovery Act.
8. With a view to keeping the President and the members of the
industry informed as to the observance or nonobservance of this
Code of Fair Competition and as to whether the thread industry
is taking appropriate steps to effectuate the declared policy of the
National Industrial Recovery Act, each member of the industry shall
file monthly in The Thread Institute office, and on or about the
first day of each month, upon request of The Thread Institute, duly
certified reports in such reasonable and convenient form as may be
provided by the Executive Committee of The Thread Institute and
containing in substance the following information:
(a) Wages and Hours of Labor.-The actual hours worked by the
various occupational groups of employees and the minimum weekly
rates of wages paid.
(b) Reports of Production, Stocks, and Orders.-Production,
stocks on hand, both sold and unsold, and unfilled orders to be
computed in the usual units for such materials.
9. To further effectuate the policies of the Act, The Thread In-
stitute will cooperate with the Administrator as a planning and fair
practice agency for the Thread Industry. The Institute will prepare
a Code of Ethics defining unfair trade practices in the industry,
and a Merchandising Plan incorporating the merchandising policies
best calculated to promote fair competition in the industry. Such
Code of Ethics and Merchandising Plan when approved by the
Administrator shall have the same force and effect as any other
provisions of this Code.
The Thread Institute may from time to time present to the Ad-
ministrator recommendations based on conditions in the industry
as they may develop which will tend to effectuate the operation of
the provisions of this Code and the policy of the National Industrial
Recovery Act, and in particular along the following lines:
(a) Recommendations as to such further reports from those en-
gaged in the Thread Industry of statistical information and uniform
accounting as may be required to secure the proper observance of
(b) Recommendations for setting up a service bureau for account-
ing, credit, and other purposes to aid producers in the industry,
and more particularly the smaller producers, in meeting the condi-
tions of the emergency and the requirements of this Code.
(c) Recommendations (1) for the requirement by the Adminis-
trator of registration by those engaged in the Thread Industry of
their productive machinery, (2) for the requirement by the Admin-
istrator that prior to the installation of additional productive ma-
chinery by persons engaged in the Thread Industry, except for the
replacement of machinery of similar capacity, such persons shall
secure certificates that such installation will be consistent with
effectuating the policy of the National Industrial Recovery Act
during the period of the emergency.
(d) Recommendations for changes in-or exemptions from the pro-
visions of this Code as to the working hours of machinery which will
tend to preserve a. balance of productive activity with consumption
requirements so that the interests of the industry and the public
may be properly served.
(e) Recommendations for requirements by the Administrator as.
to the naming and reporting of prices which may be appropriate to
avoid discrimination, to promote the stabilization of the industry
and to prevent and eliminate unfair and destructive competitive
prices and practices.
(f) Recommendations for regulating the disposal of distress mer-
chandise in a way to secure the protection of the owners and to
promote sound and stable conditions in the industry.
(g) Recommendations for dealing with any inequalities and con-
ditions that may otherwise arise to endanger the stability of the
industry and of production and employment.
Such recommendations when approved by the Administrator shall
have the same force and effect as any other provisions of this Code.
The Thread Institute will also cooperate with the Administrator
in making investigations as to the functioning and observance of any
of the provisions of this Code at its own instance or on complaint
by any person affected, and will report the same to the Administrator.
The Thread Institute will also investigate and inform the Admin-
istrator on behalf of the Thread Industry as to the importation of
competitive articles into the United States in substantial quantities
or increasing ratio to domestic production on such terms or under
such conditions as to render ineffective or seriously to endanger the
maintenance of this Code and as an agency for making complaint to
the President on behalf of the Thread Industry under the provisions
of the National Industrial Recovery Act with respect thereto.
10. The parties to this Code of Fair Competition agree to cooper-
ate in aiding The Thread Institute to perform the functions set
forth herein and to enable the said Institute to cooperate with the
Administrator to effectuate the purposes of this Code and the policy
of the National Industrial Recovery Act.
TITLE 5-MIUTUALrTY OF CONTRACTS
11. All contracts not for immediate delivery made by the members
for the sale of their products shall be in writing and shall be binding
upon the parties thereto regardless of price fluctuations. Forms for
such contracts, which shall be uniform for all members of the indus-
try, shall be established by The Thread Institute and shall be used
by all members. No other form of contract shall be used by any
member of the industry in marketing his products, except in case of
orders for immediate delivery only. No contract shall contain any
guaranty against decline in prices. No sales shall be made on
TITLE 6-SELLING BELOW COST
12. Each member agrees that he will not sell any of his products
at less than the cost of manufacture thereof and that he will deter-
mine and certify the cost of manufacture to The Thread Institute,
except that distress goods may be sold subject to the provisions of
the Merchandising Plan approved by The Thread Institute. The
Thread Institute, through committees or agents appointed by the
Board of Directors, will proceed to gather all relevant information
as to the cost of manufacture and employ such agents as may be
necessary in order to determine such costs upon a uniform basis.
13. Such of the provisions of this Code as are not required to be
included therein by the National Industrial Recovery Act may, with
the approval of the President, be modified or eliminated, if it appears
that the public needs are not being served thereby and as changes in
circumstances or experience may indicate.
14. It is contemplated that from time to time supplementary pro-
visions to this Code, or additional codes, will be submitted for the
approval of the President to prevent unfair competition in price or
other unfair and destructive competitive practices, and to effectuate
the other purposes and policies of Title I of the National Industrial
15. If any provision of this Code shall be declared invalid or
unenforceable, the remaining provisions shall nevertheless continue
in full force and effect, the same as if they had been separately sub-
mitted for approval and had been approved by the President.
TITLE 8---ENFORCEMENT OF THE CODE
16. The Thread Institute as an agency of the Administrator and
subject to his control, shall investigate complaints and violations of
this Code. The members of the industry shall facilitate such investi-
gations at all reasonable times, and in the event of any violation
being disclosed the Executive Committee of The Thread Institute
may present evidence thereof to the proper department, agency:'
or judicial branch of the Government.
Subject to approval by the President, the foregoing Code of Fair I2
Competition has been and hereby is agreed to by the undersignedt.:
members of the Thread Industry, acting through their officers there-
unto duly authorized.
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